As a construction contractor in Texas, there are many laws dictating what you must do, what you can do and what you cannot do. It is essential that you understand every law governing this industry. This will help you to avoid running into legal issues. One area that you need to particularly focused on is employment laws. A good example is understanding the use of prevailing wages.

The Texas Workforce Commission explains that the prevailing wage is a set rate of pay for workers on certain projects. The state determines the prevailing wage by looking at similar projects in the local area.

Government projects at any level require you to pay the prevailing wage regardless of any other agreement or aspect of the project. It is mandatory to pay at this level. Other projects may mandate the prevailing wage. For example, a union contract may stipulate this level of pay. You may also need to offer this wage level to attract workers and stay competitive in your area.

However, every situation where you pay the prevailing wage that is not a government contract is not mandatory and is subject to your approval. For example, if the union stipulates workers must get the prevailing wage, you could choose to work with workers not a part of the union instead.

Keep in mind that the general rule is that any work done on a prevailing wage project must be paid at that rate. This includes subcontractors and others you bring in to work on the project. It also includes all duties, including travel time, are paid at this rate.

You should keep payroll records that will prove the pay rates when paying the prevailing wage. This information is for education and is not legal advice.